NJPP Testimony: It’s Time for a $15 Minimum Wage

This testimony, on A15, was delivered to the Assembly Labor Committee on Thursday, January 24, 2019.

Good morning Mr. Chairman and members of the committee. Thank you for the opportunity to speak here today. My name is Brandon McKoy and I am the Director of Government and Public Affairs at New Jersey Policy Perspective.

NJPP has long been a strong supporter of raising the minimum wage to $15. The economic benefits for workers, their families, the business community and our state’s economy at large are significant and desperately needed. This proposal — bill A15 — will help approximately one million workers, almost one quarter of the state’s entire workforce, to better afford their needs and take care of the families.

Furthermore, these workers will now be able to more fully participate in our economy, meaning that the businesses of this state will benefit from a sizable increase in their customer base. When people can actually purchase their needs instead of putting them off due to poverty-level wages, businesses experience significant increases in revenue, helping grow and strengthen our economy.

It is no secret that New Jersey has been one of the slowest states to emerge from the Great Recession. When nearly a quarter of your workforce is earning poverty-level wages, it isn’t difficult to see why this is the case. This bill will help rectify this problem. It isn’t a silver bullet, and it won’t end poverty on its own, but it is a critical piece of the puzzle to tackling income inequality in this state.

That’s not to say there aren’t some shortfalls in this piece of legislation. The scenario for farm workers is far from certain as they may or may not see their wages rise to $15 by 2027. And the situation for tipped workers is not ideal either. While this bill increases their wages to $5.13 by 2022, it also increases the gap between the tipped wage and the general minimum wage by about 50 percent. New Jersey already has one of the largest gaps between the tipped and general minimum wage. To make it larger is not sound policy and invites increased instances of wage theft and workplace harassment for employees, especially women. As such, we also support bill A2903 which improves the state’s anti-wage theft laws in important ways, and we will continue to report on and advocate for improvements in these areas.

Poverty and income inequality tangibly harm millions of New Jerseyans. These two phenomena limit the freedom and liberty of our residents, weaken and destabilize our economy, and arrest our ability to deal with the many problems that we face as a state. Many people who testify today will try to convince you that this bill artificially inflates the minimum wage. They will say it goes too far too fast, and they will use terms like “wage mandates” to convince you that such a proposal is an encroachment on the freedoms of employers to determine what is best for them.

The fact of the matter is that had the federal minimum wage kept up with worker productivity over the past half century, it would be well above $20 by now – if anything, the minimum wage has been artificially deflated for decades. And when we look around and see so much poverty and struggle, and when we read analyses such as the ALICE report from the United Way of Northern New Jersey which shows us that 4 in 10 Garden State households are effectively working poor, we ought not be surprised at what we find.

This bill will be one of the most important, beneficial, and consequential pieces of legislation in this state’s history. It will help one million workers, make New Jersey a real competitor for workers in our region again, and inject nearly $4 billion into our economy – much of which will be spent in our local communities, helping to boost the fortunes of businesses on main street from Avondale to Waretown. This will be one of the best bills you could ever support in your career as a legislator.

As such, we urge you to support A15 and pass it through committee. Thank you for your time and consideration.